“Is there a limit to how much we can care for each other?”
That’s the radical question at the heart of economist Pavlina Tcherneva’s timely new book, ”The Case for a Job Guarantee,” due to be published this month.
The 128-page book went to print in December when the U.S. unemployment rate was near a postwar low of 3.5%. Yet that figure obscured the harsh realities of the economy it’s so often used to describe. Hallowed growth of the economy was less a rising tide than a wave that pummeled most and allowed a select few to surf.
Average real incomes for the bottom 90% of families fell from 2009 to 2012, the first three years of the post-Great Recession recovery. By 2017, that average was 2.2% lower than in 1997. And as wages continued their decades-long stagnation, planet-heating emissions soared and storms and fires grew more extreme, displacing thousands and threatening to send millions more fleeing in the years ahead.
Then came the coronavirus pandemic. By the end of May, 40.8 million Americans had filed jobless claims, representing roughly 1 in 4 workers in the labor force. As the virus ripped through nursing homes, the policy response in many states was to protect the private companies that run such facilities from liability. As the origins of the virus were revealed to be from wild animals ― offering yet another example of the threats rampant habitat and biodiversity loss pose to humans ― governments around the world, particularly the Trump administration, gutted environmental protections in a bid to spur private industries’ recovery.
It doesn’t have to be this way. Tcherneva makes the case that delivering on President Franklin D. Roosevelt’s nearly century-old promise of a job for every American who wants one would both set a modern living standard and marshal the power of the nation’s workforce to do work that so desperately needs doing. Rather than provide dubiously enforceable incentives for for-profit businesses to meet urgent societal needs, pay Americans directly to do those jobs. Then, during cycles of economic growth, allow the private sector to pay higher wages and reap the benefits of workers with new on-the-job training.
The concept is popular. Sens. Kirsten Gillibrand (D-N.Y.), Cory Booker (D-N.J.) and Bernie Sanders (I-Vt.) backed versions of a job guarantee during the Democratic presidential primary. When the left-leaning think tank Data for Progress polled the issue last summer, 55% of eligible voters supported guaranteeing a federally funded job to anyone who wants one, while just 23% opposed the proposal.
Tcherneva is a key figure in the movement known as Modern Monetary Theory, or MMT, which popularized the idea that inflation is the only real limit to federal spending ― that there is no way for the federal government to go broke when it prints its own money. In much the same way that the question of how to pay for the $2 trillion stimulus package Congress passed earlier this year was tertiary to its effects on people’s lives, I kept my hourlong interview with Tcherneva focused on the effects of guaranteeing a job rather than the theoretical and debatably important question of how affordable it is. (For more on that, you can read economist Stephanie Kelton’s new book on the subject, or watch this talk she recently gave with my colleague Zach Carter, or start reading economist Nathan Tankus’s newsletter or check out the various MMT explainers online.)
This interview was edited and condensed for clarity.
To start, let me just read the opening line of your first chapter: “Unemployment? What unemployment?” What a difference a few months make.
Yes, indeed. In the way, I’m very glad that I wrote it in an environment of a very low unemployment rate because I was hoping to shake people’s kind of view of how we’ve normalized just millions out of work. And then the coronavirus crisis just forced many people to wrestle with this idea and consider, “You know, what if it’s me? What if it’s somebody I know?”
Briefly outline for us what exactly a federal job guarantee is?
In simplest terms, it’s a public option for jobs that provide base wages and benefits. If you’re not able to find work for one reason or another, you can be assured that you can go to the unemployment office, and you will be guaranteed a menu of options in public service that you can pick from and there will be an employment opportunity there.
What would it look like if you were implementing a job guarantee today?
Look, we have a very large-scale problem today. So all manner of employment and hiring is needed. We have some very concrete things to tackle, like the COVID crisis, that require public service. Dealing with a public health issue requires that it not be for commercial return. It requires a strong public sector to put in place logistical systems ― everyone talks about contract tracing ― but it is everything; schools reorganize, workplaces reorganize. We have to make sure the elderly are taken care of and health centers are adequately staffed. We need centers for the homeless and shelters for those escaping their abusers. It is the whole wide range.
But even before this pandemic, we’ve had a lot of communities in distress. We have folks that live in awful conditions and polluted communities that don’t have clean water. What I’m saying is that the public service has been neglected for so long that we need a very robust public sector just to match these needs.
Surely, at some point, you get through the backlog. What happens, theoretically, in five or 10 years? How do you maintain a program of this size?
The job creation is not so much the complicated problem. You want to have a robust public sector, an adequately staffed [Food and Drug Administration] and [Environmental Protection Agency]. But the job guarantee is, if something happens to you, and you need a job, you need to be able to walk into an unemployment center and walk out with one. It’s not terribly difficult to imagine a model in which we just solicit proposals from large community groups that already do work on an ongoing basis. There are different ways in which you could run this. The way I’m proposing it is from the ground up, a bottom-up approach where in every community you have environmental groups, you have nonprofits, you have food kitchens, homeless shelters. They try to do this on a voluntary basis, but they are always under pressure and understaffed. So these kinds of things are ongoing.
But imagine also opening up new possibilities. We could have community theaters, urban farms, tool sheds, remediating and reclaiming materials. The way I put it: Is there a limit to which we can care for each other? Is there a limit to which we can provide services to each other? To which we can create some public value? I think the answer is probably no.
A lot of care work comes to mind, especially with an aging population.
The elderly are sheltered in isolation right now. But that is a problem all the time, where people who have reached the zenith of their life and may not have anyone to care for them, they’re left to these various private institutions that are run for profit and are inadequately staffed. I mean, that is a public purpose. We need to have some sort of infrastructure that adequately cares for the elder, for the young, for teachers stretched thin.
One thing that came to mind as I was reading this is this debate unfolding right now about how to radically change or disband police departments. Guard labor, in general, makes up a growing percentage of the workforce in many U.S. cities ― I think Orlando was at the top ― which says a lot about the society we’re building. How would a program like this lend itself to reversing that trend?
You have the whole problem where you have police officers dealing with mental health issues when that shouldn’t be their job. Imagine somebody can call a mental health crisis line. First, there’s a dispatcher ― someone has to man that line, right? Then there is a whole service of folks who have the experience to deal with these problems. It’s also true with intimate partner violence; the police may not be the right people to respond to this. It should be some trained professionals that know how to do trauma interventions. In almost every aspect of public life ― if you’re driving with a broken light ― why should you have an interaction with police? It could be just a public servant who, instead of giving you a ticket violation, is there as a public service to flag this problem. Whether it’s homeless people who are sleeping under bridges or intoxication, none of these problems should be attended by over-militarized police. A job guarantee is essentially a program through which we can foster all those additional non-police public services.
What is your response to concerns that a job guarantee will create untenable competition with the private sector, making it impossible to have low-skilled jobs that have historically paid less than what some of these guaranteed jobs would pay?
The labor market as it is right now is a Catch-22 for many people. It’s not that everyone has an opportunity. In fact, the circumstances are stacked against most folks. You have a last-in, first-out problem, where folks who are always the last ones to catch this job train, they never stay in good jobs for very long, and they’re the first to lose them. They tend to be people of color, elderly, people with disabilities. Their unemployment rate was the last one to recover. The way the labor market works, it always improves the conditions of whoever private firms think is the most employable person. And right now the folks who actually need the jobs are the ones that are scrambling, and they end up working in the most terrible working conditions.
Because of this cruel game of musical chairs, we don’t have enough employment opportunities for everyone and enough good employment opportunities for everyone. So unemployment always looms in every negotiation, and firms use this to reduce costs, which means difficult working conditions. Is this a world that we want to reproduce? Don’t we want to move away from this kind of system that creates precarity? I’m not saying a job guarantee is a panacea, but it lifts up the floor and says, look, this is the standard for jobs. There’s really no reason why anyone who’s working should live in poverty. It’s just a basic commitment to living standards.
You also see in there this thinly veiled argument for the right of firms to pay poverty wages, or else mom-and-pop shops will go out of business because now they have to pay $15 an hour. But mom-and-pop shops like to pay good wages to their employees. It’s things like the meatpacking industry that are depending on low wages and migrant labor to be profitable. And that’s a model that has to end. The job guarantee is an alternative.
It’s a paradoxical argument because all the free-marketeers love competition. A job guarantee provides competition, another option in the marketplace for good jobs. So let them compete and may the best firms survive. We want to change the nature of work and make it more stable and better paid. So what we need is a firm standard.
Would you need a role for price controls? How do you address the potential inflation from a program like this?
We’ve had experiences like this. In 1948, we nearly doubled the minimum wage at a time when the economy was pretty much at full employment. We didn’t see inflation. What the job guarantee does is serve as an anti-cyclical stabilizer. When the private sector is booming, folks are transitioning from these living-wage jobs into better-paid employment opportunities. The stimulus that this program provides in a downturn decreases in an upturn. So it’s the same thing that unemployment does now, except you keep people in employment. It’s counter-cyclical.
So assuming a program were implemented like this in the United States, what would be the international effect, living in a globalized society?
The U.S. will be a much better place overall to live and invest in, instead of having this patchwork of depressed communities. This is what the unemployment numbers hide. If you look geographically at how unemployment moves, there are communities that are permanently depressed. They are not just in Detroit. They’re across the whole country. They’re in Washington, they’re in California. So you could have a far more vibrant overall community to invest in.
After World War II, it was understood that the benefits from trade are reaped when we have full employment. It’s not the case that countries that have lower unemployment rates are necessarily suffering in the global competition because they have low unemployment rates and a decent standard of living. And if you have, as I conclude in the book, a global Marshall Plan for full employment across the globe, these would be the foundations on which free trade is supposed to take place.
There’s certainly plenty of infrastructure and nature restoration work that lies ahead of us. But I wonder whether, at a certain point, you risk a program like this increasing emissions by needing to stimulate additional activity for individuals as opposed to, say, providing a basic income?
I think the opposite. If you do community work, and it’s local, and you cut out on all the commuting, and you do care work …
Then it’s low carbon.
Exactly. The whole purpose of the job guarantee is actually to improve the environment. Now UBI [a universal basic income] has this promise that it will reduce carbon. But if you’re still dependent on the current supply chains and the current extractive system, then you’re just the consumer. There’s nothing inherent in the UBI that transforms the way we do things. It’s just a hypothetical. With the job guarantee, we’re saying very clearly and very explicitly, we have environmental work to do, so let’s put the two together.
In doing it locally, the one thing that kind of struck me is the ways in which different states currently administer unemployment benefits. Certain states, particularly conservative ones, are very adept at erecting barriers. So how do you allow a program like this to be locally administered and avoid, at the same time, their ability to obstruct it?
This is a serious question. We see how deliberately the current welfare system is being sabotaged. It doesn’t mean that the job guarantee is immune to this, of course. But the way I propose it is that we want to use all aspects of civil society to put this in place. In some circumstances, you could circumvent. Community groups and nonprofits could propose directly to the Department of Labor for funds. It creates buy-in from the community.
How would you expect immigration and the debate around it to change? Would this defuse some of the xenophobic arguments against immigration that we see right now?
This clearly has to be coupled with some sort of comprehensive immigration reform. In an ideal world, the point of the job guarantee is to provide dignified work to anyone.
How would you pitch a job guarantee to a conservative?
Jobs are not a partisan issue. We’ve surveyed the job guarantee, and it polls extremely high in deep-red Republican states.
They saw what happened after 2008 and that it took such a long time to dig out of this hole. For many, many people still living in a recession, their incomes have not been increasing. So the possibility of somebody saying, ‘Hey, do you want to work? And there’s something to do right here in the community’ ― that is a winning message with anyone.
What do you say to somebody who is afraid of what this will change and the potential disruption, when they feel they’ve carved out a decent place for themselves in the status quo?
I’d say it doesn’t necessarily concern them. If you’re happy with your life, that’s beautiful. Would you also be happy with having a new hiking trail in your community? Or maybe, you know, additional clean-up? I’m sure there’s something in your community that you drive by and you don’t like and you say, “Oh, why wasn’t that fixed?” Everybody experiences these things in our lives. If we just open up our minds to addressing that neglect and realizing improvements can be made, then folks needing good jobs can get them.
What is the relationship of a job guaranteed to the, you know, continued investment in and development of automation tools?
This is another one of those paradoxes. Jobs are pitted against technology. That need not happen. It’s only because we have accepted and tolerated unemployment. We should embrace technology. Like, let’s automate meatpacking, right? We don’t want to have well-paid folks working in dangerous conditions. To me, technology can improve our lives, but right now it is being used to create more precarity. It’s the Uberization of jobs. You don’t want that. But maybe, at some point, we will have autonomous driving machines and people won’t be driving for 10 hours across the states. I’m less convinced of the technological Armageddon argument, that somehow all jobs are going to disappear. But we should be arguing for reduced working hours, that’s long overdue. This is not about jobs at all cost. It’s about making the good life and providing one aspect of economic security.
I realize that, generally speaking, there isn’t much cause for optimism at the moment. But what makes you most optimistic that something like this could be realized?
There is an enormous appetite. There is conversation. The job guarantee is starting to pop up more and more in the conversation in the popular press. When we get a lot of different corners calling for the same thing, then hopefully that’ll be enough pressure for change on the policy level.
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